Mass. lawmakers disclose mortgages

Sunday

Jul 8, 2012 at 12:01 AMJul 8, 2012 at 8:04 AM

Most local members of Congress reported they had mortgages worth more than $200,000, disclosing the data for the first time to meet a new requirement meant to shed light on any sweetheart deals between lenders and lawmakers.

David Riley and Brian Benson, Daily News staff

Most local members of Congress reported they had mortgages worth more than $200,000, disclosing the data for the first time to meet a new requirement meant to shed light on any sweetheart deals between lenders and lawmakers.

Local House members reported that they, their spouses or dependent children owed at least $200,000 on two mortgages in 2011, except for U.S. Rep. Richard Neal, D-2nd, who reported one mortgage worth $50,001 to $100,000.

Sen. Scott Brown disclosed a line of equity worth between $100,001 and $250,000 on his Wrentham home, as well as four mortgages on other properties, including two in Natick.

Sen. John Kerry sought and received an extension until August to file this information.

These details are now part of financial disclosures members of Congress must file every year. Previously, they had to release mortgage details only for properties they rented out for income, according to the nonpartisan Center for Responsive Politics.

That changed under the Stop Trading on Congressional Knowledge Act, a new ethics law meant to prevent members of Congress and their staff from making financial trades based on inside information gained in their official duties.

John Ambacher, a political science professor emeritus at Framingham State University, said the new law does not surprise him.

“I think legislators are sensitive to the fact that given the state of the economy and people’s anxiety, anything that even smells of advantages in the economic marketplace is very volatile,” said Ambacher, who lives in Blackstone.

But, given the prevalence of lobbying, it may be impossible for lawmakers to not have some inside information, he said.

“I think the real difficulty will be to put in place some sort of barrier,” he said.

Part of the act requires members of Congress to disclose residential mortgages, the dates of the loans, a range of the amount they owe, the lender’s name and other details.

Prompted by scandals in which mortgage lenders gave lawmakers preferential treatment, the measure aims to make sure legislators are treated like anyone else, said a statement from Sen. Barbara Boxer, D-Calif., who pressed for the mortgage requirement with Sen. Johnny Isakson, R-Ga.

Maureen Dunne, a Framingham resident and Framingham State University economics professor, said the disclosures are a good first step but there must also be enforcement, whether from federal regulators or voters at the polls.

“No one who is voting on a bill should be receiving special rates or conditions on their mortgages,” Dunne said. “It should be a level playing field whether you’re in Congress, the executive branch or a lay resident.”

The House and Senate interpret the new rule differently, with only senators disclosing the interest rates they received on mortgages. Both chambers should be reporting that information, said John Wonderlich, policy director at the Sunlight Foundation, which advocates government transparency.

“Some of the previous ethics scandals ... were explicitly about accusations of preferential interest rates being given to people in influential positions,” Wonderlich said.

Even if missing that key detail, the disclosure reports offer new insight on the real estate holdings of federal lawmakers from Massachusetts.

Brown, whose website claims he was the first to introduce the act to the Senate, listed two mortgages each worth $100,001 to $250,000, and a line of equity in the same amount from Wrentham Cooperative Bank.

The equity line is on his primary home in Wrentham; the mortgages are on a rental home and a property on which he is only a co-signer, both in Wrentham.

The Natick mortgages were worth $100,001 to $250,000 for a second home and $50,001 to $100,000 for a rental property. Both are with Natick-based Middlesex Savings Bank.

Interest rates on Brown’s loans ranged from 3.25 percent to 5.75 percent, according to his report.

Rep. Niki Tsongas reported the largest single mortgage of the state’s congressional delegation — $500,001 to $1 million from TD Bank for a Charlestown property. She also had a line of credit worth $100,001 to $250,000 from Enterprise Bank and Trust for a home in Chatham.

Tsongas said in a statement that she was an early supporter of the Stop Trading on Congressional Knowledge Act.

“The new requirement to disclose information about real estate mortgages will add even more transparency to our annual personal financial disclosure statements,” she said. “It will also ensure that members of Congress are not given any special treatment when it comes to their mortgages and are treated the same way as any other American.”

U.S. Reps. Jim McGovern, D-3rd, and Ed Markey, D-7th, each had mortgages between $100,001 and $250,000 for homes in the Bay State, and larger loans of $250,000 to $500,000 for residences closer to Capitol Hill.

Both McGovern’s mortgages for homes in Worcester and Washington, D.C., are from Bank of America of Simi Valley, Calif. Markey owes Members Mortgage Co. for his house in Malden and Chase Home Finance for a home in Chevy Chase, Md.

Neal, who represents a district that will no longer include the Milford area after the November election, holds his mortgage with Suntrust Bank for a home in Springfield.

Retiring Rep. Barney Frank, D-4th, whose district will gain the Milford area after the election, did not list mortgages in his disclosure report.

Wonderlich said he hopes to see real estate transactions listed in congressional financial disclosures, too, after a number of scandals involving property. It’s one of several issues in the act that need to be addressed, he said.

“It’s better than not doing anything, but the law clearly has a lot of shortfalls,” he said.

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